Ah, if you can't skin a cat federally, nail one locally. Praise Jesus and thank God for State law.
Paterson's Plan to regulate Credit Default Swaps.
This is really good news actually. The crux of the plain is
CDS sellers must prove the ability to pay in case of a default.
There is immediate blow back from those dealing with derivatives which is probably a good sign this will actually start some regulation.
Paterson's plan only covers about 1/5th of the market, but 20% is sure better than no percent!
New York State can also not regulate naked swaps.
Now, if only our lovely Congress would follow the good Governor's lead....immediately.
If you had no idea what this post means, use the search on this site, there are multiple posts either citing others or with embedded materials to explain the very bizarro derivatives market.